Thursday, September 17, 2009

Better world: Generate a feed-in frenzy

Paying people who generate green energy and feed it back to the grid is the best way to boost uptake of renewable energy.

ONE day, 100 per cent of our energy will have to come from renewable sources. But how do we make it happen?

There is a proven way to rapidly boost the adoption of renewable energy - give companies or individuals who want to generate green energy access to the grid and promise to pay them extra for the electricity they "feed in" over the next 20 years or so.

This approach is known as a feed-in tariff, and since Germany introduced feed-in tariffs in 1990, the proportion of electricity it generates from renewable sources has grown from less than 3 per cent to about 15 per cent in 2008. By comparison, the UK, which tried to boost renewable energy through analternative "green certificate" scheme, generated just 5 per cent of its electricity from renewable sources in 2008.

Other countries are now trying to emulate Germany's success. To date, 21 European countries have introduced some form of feed-in tariff, and this year the UK, South Africa and the Canadian province of Ontario announced plans to implement similar schemes.

The catch with feed-in tariffs is that consumers or taxpayers have to foot the bill for the higher price paid for renewable energy. Partly for this reason, they generally favour or are limited to smaller generators. While this is not ideal, small power generators can make a big difference if there are enough of them. According to some estimates, microgeneration could provide up to 40 per cent of the UK's electricity by 2050.

Even with guaranteed prices, though, the initial investment in the generating equipment - a photovoltaic panel, say, or a small wind generator - puts the technology beyond the budget of most households. Fortunately there are other ways for people to take advantage of feed-in tariffs.

More than 350,000 households in Germany hold shares in wind turbines, and almost all wind farms in Denmark are community owned. By providing people living close to the generators with extra income, community-owned renewable power schemes can also help overcome local opposition to what people might otherwise see as intrusive wind turbines.

Read more: Blueprint for a better world

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